In situations like this, it no longer possible to create a win-win solution, as the win of one party will always be the loss of the other party. Hence, one should only be focused only on calming the value. The company had two options. The first option was to buy the plant from Seltek, a small pharmaceutical company, which would allow for the immediate start of production.
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In situations like this, it no longer possible to create a win-win solution, as the win of one party will always be the loss of the other party. Hence, one should only be focused only on calming the value. The company had two options. The first option was to buy the plant from Seltek, a small pharmaceutical company, which would allow for the immediate start of production. As we knew that the similar property in the neighbourhood was sold after being on the market for three year, we assumed that company might have problems with selling the property for an attractive price.
It was made at the lowest justifiable price that we could have found, which was the value of the insurance in case of a total loss. That enabled us to favourably anchor the negotiations. Having said that, all offers made where supported by facts, which sometimes made them easier to accept and in consequence made the negotiation process smoother.
On the other hand, by relying on facts too much, at one point we ended up arguing over valuation of the plant, instead of focusing on the concessions and reaching the deal.
What could have been done better was setting more ambitious target. Moreover, after the role play it was revealed that the other party BATNA was lower than our first offer. Moreover, even though we decided to not to reveal our reservation point, it was not successful because by making a large concession we showed them that we have a lot of money to spend.
On the other hand, the strategy that did not work was an attempt to unbundle other issues by asking questions about interest. The other group was not clear about their intentions and we proclaimed wrong signals.
At some point, we thought that they will insist on selling the factory as a package deal with the patent, which made us make higher concessions regarding the price of the plant, so that to avoid buying the patent. Even though the strategy itself seems be highly effective in some cases, I would be careful when applying it. The other severe mistake we made in choosing the strategy was to not plan our concessions beforehand, which would give us more control over the process.
Another thigs to consider, would be the impact of our target, BATNA and first offers on the negotiation. We made the first.
Get custom paper I Biopharm Seltek was the first negotiation that I walked into this semester, and it is also the first negotiation that I prepared myself by reading and learning different strategies to use in different situations. I knew that I had to be well prepared with the information I had but at the same time think about few questions that my colleague from Seltek would ask and think about their reservation price as well, because not only I want to do a good job by understanding my reservation price and BATNA but to have a plan and idea of their RP in order to get a good deal for my company. After I came up with the plan I tried to get some background information about the Seltek negotiator. This is where the four Ps were really helpful, It was very important to understand the purpose of the negotiation and I believe because I understood the purpose I did a better job in getting a great deal for BioPharm. At the same time I was thinking about the relationship as well and think how I should me calm and listen to other party during the negotiation. During the time of preparing for the negotiation I had a question on how we should start the process, Should I go first or should I ask the Seltek negotiator to give his first deal on the table?. So I decided to think logically for a minute and decided if I go first I could have an anchoring effect on the other party therefor I should go first.
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Biopharm - Seltek Negotiation Case